Adapting an Amazon advertising strategy amid coronavirus
Last week, many of our vendors and sellers received the news that Amazon was reducing or pausing purchase orders for non-essential items. This may mean big opportunities for brands selling high-demand and in-stock essential such as medical supplies, household staples and other essential products. However, any product classified as non-essential have also been directly and immediately affected by this decision. The expectation is that this will continue throughout April, at least, and so we recommend to our brands to adapt their Amazon selling and advertising strategies to meet the new demands during this time. Strategies, including ad and media spend, need to be adjusted immediately, or brands selling essential products risk losing an opportunity to capitalise on sales. Whereas those classified as non-essential may be wasting ad budget in the short-term.
In these past few weeks, our Amazon advertising team has seen first-hand how spend and consumption has changed drastically. Both vendors and sellers have seen changes to their PO process as Amazon attempts to keep up with demands, free up warehouse space and allow their fulfilment centres to give priority to essential items. However, regardless of if you’re a vendor or seller or if you sell essential or non-essential items, it’s important to adjust your overall Amazon strategy and advertising plan immediately. In order to help brands navigate their Amazon advertising strategies during these times, our team has provided some of their top advertising insights and tips for brands to focus on.
Pro tip: We are still seeing many of our brands with products classified as ‘non-essential’ being able to ship their products across Europe. This mean you can’t afford to neglect a sales and advertising strategy for these non-essential items at this time. However, adjusting ad spend and prioritising essential products over products with lower-demand is a smart strategy at this time.
How has coronavirus impacted Amazon advertising ad spend so far?
We have seen a drastic shift in traffic, conversions and supply chains in the past few weeks. There are many brands who are able to meet the increase of demand, capitalising on the opportunity. Our PPC managers and executives are also seeing massive changes in media spend and purchasing behaviours. Our brands selling essential products should be thinking about increasing their media budgets immediately to capitalise on this opportunity. However, for brands that do not sell essential products, our account and PPC managers are working closely with them to support on the most effective strategy because they may need to decrease media spend in the short-term
How can brands adjust their Amazon advertising strategy during the coronavirus outbreak?
1. Check and adjust your search terms
Our team have noticed that since the COVID-19 pandemic started, the usual keywords that they had been using for our clients were suddenly becoming more and more irrelevant. People weren’t searching for products the same way they had been. Additionally, some keywords were suddenly massively searched for, including ‘laptops’ and ‘hand sanitiser’. Adjust your keywords and your budget in order to ensure you’re capturing as much traffic as possible for high-demand and in-stock products. For our brands selling essential and in-demand products with strong supply chains, we have seen a huge increase in advertising related conversions. We are seeing a decrease in the average cost-per-click and an increase in click-through-rates and conversions, leading to lower ACoS. Equally, brands may want to look at reducing ad spend for products that are in lower demand or lower supply. Otherwise, they risk wasting ad spend in the short-term for products that aren’t able to be shipped.
For more detailed insight into the sort of keywords that have had a massive spike in searches in the UK and Italy recently, check out our insight post about Amazon sales during the coronavirus pandemic.
2. Review your automatic campaigns
During this time, we also noted an increase in spend and ACoS on some of our automatic campaigns. When our PPC managers investigated they concluded that the loose match targeting was behind the increase. Products such as shower gel were being loosely matched for major trending keywords such as ‘antibacterial hand wash’. They decided to pause these loose match targets to reduce wasted spend and irrelevance. Take a look at all loose match keywords to ensure you’re not spending more than you should be on searches that won’t lead to conversions.
3. Consider advertising using Amazon DSP
Due to the quarantine, many more people are stuck at home watching TV and using their computers. This would be a great time for brands to start investing in DSP advertising or to increase their media spend as the audience size will be larger and therefore possibly much less competitive. If you have questions about Amazon DSP and the best strategies for your brand, get in touch.
4. Increase or decrease your sponsored ad bids depending on your brand and the demand
With a significant shift from Amazon to prioritise essential and in-demand categories, these products are becoming much more competitive. This means that vendors and sellers should decrease spend on low-demand and low-stock items, while looking to increase bids for their more desirable stock. If you’re selling essential products and your supply chain is strong, you should be looking at increasing your advertising spend. We have seen major increases in sales leading from an effective advertising strategy during this time so it doesn’t make sense to take your foot off the pedal depending on what category you’re in. Speak to your Amazon agency and your account managers or your in-house Amazon team to discuss how to best capitalise on the increase in demand. For those not selling essential products, there are still opportunities for conversion on sponsored ads, don’t discount them all together.
5. Move your budget according to stock availability
If you are confident in the amount of stock you hold for specific ASINs consider increasing your total investment to be live all day everyday in order to really rack in impressions and conversions. However, if you start to find your stock getting low, begin to focus your advertising strategies on alternative, high-stock products customers may be interested in from your catalogue. If you are out of stock on popular, high demand ASINs, use Sponsored Product ads and product targeting to advertise in stock ASINs so customers ending up on an OOS ASIN will be redirected to alternative product of your choice. Finally, if you sell through all your inventory, move your budget toward upper funnel activities such as Sponsored Display & Sponsored Brands to drive awareness to your brand until your stock is replenished.
Don’t let coronavirus halt your Amazon advertising campaigns
The COVID-19 pandemic might have been unexpected, but it doesn’t mean it has to stop your Amazon ad campaigns. With quick thinking and continuous keyword research, some brands have begun seeing an increase of their sales than they did before with our help.
At Molzi, we understand that to be successful, we must look at the positives found within such difficult times. One such positive is that many of our brands are seeing a large increase in Amazon sales. In fact, they are shifting traditional advertising and media budgets towards Amazon to capitalise on this opportunity. Amazon is the perfect avenue for some brands to use as a go-between for them and the self-isolating consumer. Find out how our account management team can help you make the most of such a drastic situation today. Also, learn how as a company, Amazon is handling the coronavirus pandemic.